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What CBS, Disney and other media companies are saying about OTT in Q2

Each passing financial quarter seems to further solidify the shift toward digital platforms, as media companies continue to use earnings season to provide updates on their evolving online video strategies.

The second quarter reporting season of 2017 was no different, and FierceOnlineVideo went ahead and rounded up the relevant comments some of the top media companies (21st Century Fox did not report as of press time) made within their reports and during their earnings calls.

CBS

CBS dumped a surprising amount of big OTT announcements during its earnings call this week, and mere hours after announcing it had officially (and finally) signed a distribution agreement with DirecTV Now.

The broadcaster was still being cagey about specific subscriber numbers for its All Access and Showtime OTT products, but it did reveal that the two services are on track to amass 4 million subscribers combined by the end of 2017, halfway toward CBS’s goal of 8 million combined by 2020.

The company also revealed that it plans to soon launch a live sports streaming service—one that will be different from anything ESPN or Fox Sports has in the works, according to CEO Les Moonves—and that it will also begin an international expansion next year for All Access, starting in Canada.

Discovery

Discovery overshadowed its somewhat disappointing second-quarter earnings with the announcement that it’s dropping $14.6 billion on Scripps Networks Interactive. Discovery CEO David Zaslav said that Discovery and Scripps might now have the combined scale to launch their own lifestyle channel streaming service and charge $10 to $20 per month.

But during the earnings call, the company highlighted the growing amount of streams, up 76% since the fourth quarter of 2016, for its GO platforms, as well as the continued expansion of its Eurosport Player OTT service in Europe.

Disney

Disney also dropped some significant news with its earnings, announcing it is buying a majority stake in BAMTech for $1.48 billion and launching ESPN- and Disney-branded streaming services.

“This is an exciting validation of our team, its achievements and the customer-centric platform it’s built,” said Michael Paull, CEO of BAMTech, in a statement. “Yet, we’ve merely scratched the surface of what can be accomplished in a future where we combine Disney and ESPN’s world-class IP and our proprietary direct-to-consumer ecosystem.”

The ESPN app, launching next year, will feature 10,000 live regional, national and international games and events a year, including Major League Baseball, National Hockey League, Major League Soccer, Grand Slam tennis and college sports.

The Disney streaming app will be home to Disney and Pixar films—meaning Disney’s deal with Netflix is coming to an end—as well as exclusive original movies and series.

NBCUniversal

While NBCUniversal owns a significant stake in Hulu and has signed distribution deals for its broadcast and cable networks with all of the major streaming TV services, NBC remains hesitant to become too enamored with online video, particularly as it pertains to virtual MVPDs.

NBC CEO Steve Burke said as much during the company’s second-quarter earnings call, making sure to minimize the current and future impact of streaming TV.

“We have deals in place with all of them. They're actually very favorable. So from an NBCUniversal point of view, if someone goes to an over-the-top provider, it's actually slightly better. But it's a very tough business. And as we've said before, we're skeptical that it's going to be a very large business or profitable business for the people that are in it. And they're off to a relatively slow start,” said Burke, according to a Seeking Alpha transcript.

Viacom

While Viacom remains convinced an entertainment-only skinny bundle will be available from pay-TV operators within the year, the company is benefiting from having its content on SVOD and OTT platforms outside of the traditional TV ecosystem. Viacom’s domestic affiliate revenues rose 4% to $1.01 billion thanks to higher revenues from SVOD and other OTT agreements.

But, given the timing of SVOD and OTT agreements in the June quarter, Viacom expects domestic affiliate revenues to decline in the low single digits for the September quarter.